Ha Noi has proposed to the Prime Minister to put in place a special mechanism to build 22,300 commercial apartments, which would help add to the housing stock for relocation.

Accordingly, the capital city expects to select capable developers without going through the bidding process.

The land use fees will then be calculated at the time when the land is handed over to the developers, but they must be allowed to pay the land use fees later, when they sell the apartments to households, the city’s proposal suggested.

In addition to this, the developers will be allowed to have a profit of 10 per cent (excluding loan costs) to implement these projects, similar to capped profit for developers of social housing projects.

If the proposal is approved, Ha Noi will start developing 22,300 apartments within this year for the relocation of residents to clear land for the capital city’s other development projects in the period between 2018 and 2020.

The development of 22,300 commercial apartments is estimated to cost around VND55 trillion (US$2.5 billion).

The city said that with such mechanism, it would only have to arrange capital for land clearance, while other costs would be covered by raising funds from developers and investors.

In addition to this, the residents will also benefit by enjoying quality facilities of the commercial apartments — much better than relocated houses.

Prime Minister Nguyen Xuan Phuc has asked the capital city to optimise the use of land resources and implement policies to raise private capital and resources to develop infrastructure projects. — VNS